Jan062018

Watertown Public Opinion

With the Tax Cuts and Jobs Act now officially law, U.S. Rep. Kristi Noem, R-S.D., made a stop at Titan Machinery in Watertown Friday morning to tout the legislation’s benefits for South Dakota taxpayers.

Passed along party lines, the bill has elicited polarized reactions nationally.

As a member of the Ways and Means Committee and the conference committee that reconciled the House of Representatives’ and Senate’s versions of the bill, Noem pushed back on the negative claims, particularly that the bill is primarily aimed at benefiting millionaires and billionaires.

“We ended up with a final package lowering rates for everybody,” she said. “On the individual side, we lowered rates for all income levels. We have made bigger deductions for small families.”

Particularly, Noem claimed, the tax bill will benefit small businesses.

“We put in place a brand new provision in the small business rate that any business that’s under $315,000 per year automatically gets a 20 percent deduction off their business account,” Noem said. “That’s a huge tax cut for small businesses. We had 83,000 jobs in the state tied to small businesses. That was a big priority for us going forward.”

Noem also said reduction of the corporate tax rate from 35 percent to 21 percent was long overdue.

“We had the highest corporate rate in the world. Frankly, we saw a lot of companies and manufacturing businesses going to other countries because every other country had lower corporate rates than us,” she said.

Noem tied the lowering of the corporate tax rate along with raising the tax deductions of the cost for certain types of property from a cap of $500,000 to $2.5 million under Section 179 of the Internal Revenue Service Code.

“That is one of the tools that is going to give us the most growth in this country,” Noem said of the deduction cap increase. “Since this bill has been passed, we’ve had over 100 companies saying they’re coming back to the United States and building here because of this law. In South Dakota, somebody told me yesterday that there will be 20 brand new projects. A lot of them announced they’re going to give wage increases, including at $15 per hour.”

In comments to the Public Opinion, Noem said a Congressional Budget Office estimation that the tax reform bill would likely add $1.5 trillion to the national debt over the next decade doesn’t provide the whole picture.

“The CBO looks at everything in a static way. They don’t take into account reactions that will happen to tax reform. I understand their limited scope gives them a number like that,” Noem said. “For us, when we did these policies, we looked at what people’s reactions would be to tax cuts. All projections show that people will reinvest in their businesses and families, turn that money over and grow our economy, which turns that federal deficit around very quickly.

“We’ll see growth that will get more people off programs and into jobs paying more taxes. That adds up to more revenue in the country.”

Noem also spoke at some length on the renewal of the farm bill that is being discussed in Congress.

Noem’s stop in Watertown on Friday was part of a statewide tour promoting the bill.